Fundamentals of Value Added Tax

Fundamentals of Value Added Tax

OBJECTIVES

• Discuss the history of VAT, some of its advantages and disadvantages and how it fits into the tax mix of states around the world.
• Describe the way in which VAT operates, particularly in respect of output tax and input tax, in such a way that it remains neutral in its application by businesses.
• Identify how VAT applies to international transactions of both goods and services and how the system allows for neutrality by ensuring that imports and exports are neither advantaged nor disadvantaged over domestic supplies.
• Discuss how VAT works within the European Union’s free market.
• Explain the impact of exemption in VAT and how tax is calculated by businesses that deal in exempt supplies.
• Categorize some of the more important administrative issues that VAT requires.

COURSE OUTLINE

• Introduction to value added tax
• Basic characteristics of taxable supplies – goods and services
• Taxable persons
• Taxable amount – VAT rates and exemptions
• Place of supply – Goods
• Place of supply – Services
• Deduction and recovery of input tax
• Administrative elements of VAT